It's always interesting that such meetings are held on Friday and Saturday, and you have to take time off from your practice and everything else that you do. That's a real... that's a fake camera mic, that's a fake camera mic. Okay, here we go, that's a good start. Yes, okay, so it's great that you take time off to come and visit with us because I think at the end of the day, I'm hoping that what we could add is substance to what Leticia ended with, and that is at the end of the day, most of you in a medical profession or in the health profession, what you really want to do, despite all these business aspects of the business and everything else, is that you really want to sincerely provide quality care. And that is impinging right now because of all the things that are happening in the world, that your ability to provide quality care is really being discounted and widely diminishing. And Leticia also mentioned another point regarding supplementation, that's a worrisome thing in your world because you really are not sure what... when your patient comes to you and presents a product to you, you're really not quite sure how you're going to advise the person, and that adds on to your angst. And in fact, every week when you pick up your New England Journal, you see another article on why supplements are really bad for your patients and so on and so forth. I'll be focusing on this technology that we call the biophotonic scanner, and I will explain some of the science to you so that you have a level of comfort that fundamentally what we're trying to do is really answer the question: how do you really know whether your supplements work or not? At the very least, or at a very minimum, when you leave here, you will have some idea. At least we can measure, because when you talk about science, you really don't talk about science. Science is really about measuring. Science is actually about basing your conclusions on data, regardless of what field of science you come into. It's really all about measurement, isn't it? So that's what we're trying to do with the scanner. I was back in Hopkins visiting a friend of mine back there, and he obviously is in academic medicine, and he was telling me, boy, you know, even in academic medicine we are being bombarded with all these questions regarding supplementation as well. And I sat down with this friend of mine, whom I post-doc'd with, oh gosh, more than 30 years ago before I joined the drug industry, that he actually thought that this was a good idea as well. So it is comforting to me that even a friend who pulls no punches managed to see the scanner as a viable technology in our world. So let's go through this very quickly. Fundamentally, Pharmanex in 1995 was co-founded, and I was one of the co-founders, together with another buddy of mine by the name of Michael Chang. He was trained, and he still thinks he is, a medicinal chemist. And Michael worked in a company whom all of you should be familiar with, and that company was Merck, and he was really responsible for their drug discovery programs. And on the other side of the fence, I was responsible for drug discovery in another drug company called Wyeth, and I sort of participated and worked in that company close to about 11 years. And over that period of time, I actually sort of contributed to the development of Rapamune, which is now the anti-rejection drug, and also to another non-steroidal by the name of Arthrotec, and then finally another photodynamic therapy drug that's called Photofrin, which is specifically a selective brain tumor destroying type of molecule. Which when you give it intravenously, it goes into tumor cells and not to the normal regular brain cells, and when you activate the light at a particular wavelength, it actually generates free radicals to destroy that tumor cell. So it's fascinating. But fundamentally, we got together, Michael and I, and we decided to really focus on natural products and natural ingredients to start this company that we call Pharmanex. And one of the first scientific advisors that we consulted with is this Professor Jasi, and he was a Stanford chemistry professor. He started, in fact, he was a co-founder of Syntex, which right now doesn't exist anymore in the Bay Area because it's now part and parcel of Roche. And once again, he has lots of experience, and sort of when we told him about our idea of starting a company based on a premise of converting and translating natural ingredients into dietary supplements, he sort of thought, well, it's a good thing, but make sure you don't develop snake oil. Fundamentally, you know, use what you have learned in the pharmaceutical industry, i.e., good manufacturing practices, you know, double-blind clinical studies, and so on, all the things that you should do to make sure that you can substantiate that your product is safe and effective. Because if you look at it, if you in fact one day meet a physician or the healthcare provider, you will be expected at least to assure that individual that he's not going to do any harm. Fundamentally, within your Hippocratic Oath, you know, there's this phrase about doing no harm. And at that point in time, back in '95, the supplement world was fraught with this risk and essentially, you know, infused with snake oil and all sorts of supplements that don't meet the required standards of safety and efficacy. Because it's all a matter of ground-up leaves being encapsulated, putting into a bottle, and then slapping on a nice-looking label and call that a dietary supplement. And we didn't want to start with that premise, but actually overturn the apple cart, if you will, and say, why don't we do it a better way? And essentially, focus Pharmanex on making pharmaceutical-grade, science-based supplements. That's how we started Pharmanex. So we started that in 1995 and raised about $46 million from three fairly sophisticated investor groups, and that would be Fidelity, whom you all know, they're located in Boston, one of the largest, if not the largest, mutual fund company, and they had a venture arm. We raised money from the Pritzker family, who owns the Hyatt Hotel chain, one of the richest families in Chicago. And then the third one was J.H. Whitney, which to us was actually far more impressive than the other two because J.H. Whitney is the oldest venture capital group in this country. If you look at the history of venture capital, you would see that J.H. Whitney was a pioneer in venture capital. He actually funded the railroad in the United States way back. So they have many, many years of funding startups, and for them to come in based on this story of making pharmaceutical-grade, science-based supplements was appealing enough for them to invest in a company. It was a bit of a reassurance for us that maybe we're on the right track. And then in 1997, we launched five products in 38,000 stores in the traditional mass market channel, that would be Walmart, Walgreens, right, of the world. And then in 1998, we got acquired by Nu Skin Enterprises for roughly around $135 million, and that was the portal, if you will, that how I came into Nu Skin Enterprises. And I continued to learn about this business, and what we brought into Nu Skin Enterprises is this reality of making pharmaceutical-grade supplements, this R&D engine, if you will, this ability to use science to translate what we know from all the historical documents about natural ingredients and how those ingredients, if we use the modern scientific method, we perhaps could actually add value to those ingredients. And we did that through this process that we call the 6S process. It's just an acronym, it describes the six steps that we use to manufacture and finally launch a dietary supplement in this company. Okay, and if you look at it, I won't go through each of those steps, but fundamentally, if you look at it, what we want to make sure that we do not use garbage, because no matter how good your process and how good your science is, if you're putting garbage in, you are going to get garbage out at the other end. So we wanted to make sure, as I said, through this 6S process, we wanted to make sure at the very minimum that our supplements are safe, it doesn't contain any toxic contaminants, we do not adulterate our product with steroids, we do not... we analyze our products with banned substances, all the things that we would think, you know, in this 21st century, that every company would be doing. Unfortunately, it is not the case. And you hear many companies saying they're doing science, and it's difficult to really believe that particular claim because science in this day and age is really about using a multidisciplinary approach. It is about having close to about 100 scientists in the company, which we have currently, to be able to cover all the various scientific disciplines. We cannot just have chemists in our company because they don't know much in terms of biology, or vice versa. So as you can see here, we have a whole array of scientific expertise in the company, and this is really the R&D engine that I'm talking about. And in fact, frankly, I'm really the mouthpiece for these guys, that you ought to be meeting them and you ought to be speaking to them, because don't take my word for it. Fundamentally, these are the folks who help to develop our products in Nu Skin Enterprises. And we do that in three R&D centers around the world. As you know, the Chinese in general, they have a very rich tradition, this so-called traditional Chinese medicine philosophy. And what we find from it is the fact that yes, they have, and in fact, it's quite well documented, they actually have the first original pharmacopoeia, if you will, written in Chinese. And we have lots of experts in Chinese, they're scientists, they're trained in Western science, but they are very able to access that knowledge and then sort of pull out the gems, the insights that these folks had way back, and see whether we can use the scientific method to translate that to something meaningful in this day and age of modern science. And that's why we have two R&D centers in China. The one in Beijing primarily focuses on clinical and biological studies, and the one in Shanghai is the R&D center focusing on making sure that when we source raw materials from China, at least we know that raw materials are pure and we get it in the form that we want. And we bought it for, you know, we give them specs, and in general, I just don't trust the Chinese, and that's one of the reasons why I have an R&D center in Shanghai. So that's what we have. And we're not proud, frankly, in spite of the fact we have the multidisciplinary team here, we do not suffer from the so-called NIH syndrome, i.e., this non-inventiveness of some of the universities. We've worked with ranging all the way from United States to Asia and to Europe as well, and these are world experts, and many of them have contributed to the understanding and how we should develop a particular product. And just to name-drop a bit more, this is our motley crew of scientific advisors, and again, I just highlighted two of them. One, Koji Nakanishi from Columbia, he helped us to develop our protocol for BioG. And then on the right, on a post-it note, by Austria, that is Professor Karl Jasi, and again, officially he likes to be known as the father of the oral contraceptive pill. I find that an oxymoron, but I've stated it, and you just need to think about it how you can put those two terms together. And just to add on, because we are now moving into the world of genes and how genes are influencing how we function and who we are, because since 2003, with the mapping of the human genome, we think that this is the way to go. This is revolutionizing the world of medicine and the world of natural product development as well. And because of that interest and focus going forward, we have brought an additional three more SAB members onto the board. And the first two, starting from the left, is Richard Weindruch, Professor of Medicine at Wisconsin. In the middle is Tom Prolla. These are the co-founders of a company, and if you Google, you will find them. They started a company, a biotech company, called LifeGen Technologies, and we are collaborating with them very actively to develop our so-called ageLOC products going forward. And then finally, Stuart Kim comes to us from Stanford, and he understands the aging process at the genetic level in depth, and is one of the pioneers, if you will, in using genetic analysis of the aging process. So these are... we continue to invigorate, if you will, and refresh our SAB with new knowledge, with new expertise. The company, it is what it is, it is Nu Skin Enterprises. And frankly, 13 years ago when I got into this discussion of acquisition, my first personal reaction, since I was in Los Angeles, Pharmanex was actually located in the Los Angeles area, my first reaction was, well, what's this company, Nu Skin? You may experience the same reaction. In fact, you would think, you know, it can't be a real company, right? It can't spell 'new', let alone being in Utah. So, however, it is obviously, again, if you use the Google, you will find that we are indeed a New York Stock Exchange publicly traded company. And the reason why that's important for all of you is because we have to be transparent. Being a publicly traded company, unlike many of the privately held companies in this world, they do not expose what they do in-house financially or otherwise to you. We have to, and that transparency ought to be, you know, add on to your level of comfort that we do adhere to the higher standards of reputation, or else all of us would go to jail. Well, the managers will, the scientists will probably find another job. So, okay, here's the scanner. Let me quickly go through the scanner because it's a fascinating thing. We developed the first version in 2003, and the two inventors, the patent that we have exclusively licensed this scanner technology, are Professor Werner Gellermann and his colleague Robert Melan. They are faculty members at the University of Utah Department of Physics, and they sort of really back in 2003 managed successfully to use a very sensitive physical law called Raman spectroscopy to measure certain types of antioxidants. That's really what the patent was all about. And initially, they focused this technology on developing an instrument that can actually analyze the retina by shining some non-damaging laser light onto the back of the eye. Because the retina, evolutionarily, has evolved because it receives so much light, and because of the light, although the light coming in is good because of how you see, but the problem is when the light hits the retina, it also has the potential to generate free radicals. So the retina has evolved to a place where now it's highly enriched, that part of the eye is highly enriched with these antioxidants called carotenoids. That's how those carotenoids are there in the retina to neutralize the free radicals when light hits that part of the tissue. Okay, so that's why Werner went after the retina and see whether he can use Raman spectroscopy to see whether he has any diagnostic ability to detect AMD, age-related macular degeneration, at the early onset before it becomes symptomatic. So, but with that, when we started to chat with him, we decided to actually say, move away from the eye, because our distributors are not very careful when they shine things on the eye. So we didn't think it was commercially viable for our world. So we say, why don't we go to another piece of tissue that's a bit less risky, and that would be the skin, and see whether we can use the same instrumentation to detect these types of antioxidants on the skin. And we managed to do that. That's where the patent is. And what we find again and again, that is a very sensitive way of detecting skin carotenoids. When we started at the very beginning, the scanner back in 2002, 2003, it actually looked like a weapon of mass destruction. That's the picture on the top left. In fact, if Josh Bush had come here, he would have continued his presidency, but he didn't. So anyway, so here's the weapon of mass destruction back in 1999, and then in 2003, we managed to reduce the size of it. Obviously, we couldn't launch that room full of cables running all over the place, but by 2003, we successfully converted that technology and put it into this toaster-sized unit called the biophotonic scanner. That is a picture of the first scanner we produced. Now, with that, we have now reached a point, this is almost like the third version that we call the average version or edition, and this is what we're using right now today for all our distributors and everybody else to measure antioxidants. It's very small, it's very reproducible, it's absolutely validated. We now have seven years' worth of data, more than 10 million scans around the world, to be able to use that database to validate what the technology is really measuring. And let's go through that very quickly. And we have written a review paper, so we have actually submitted much of those type of data for peer review and get it into manuscripts and finally into print. And this is just an example of the significance of measuring carotenoids and how that actually translates to an indication of overall nutritional antioxidant health in the body. And fundamentally, what Lester Packer from Berkeley tells us is the fact that antioxidants don't exist in isolation. For our intents and purposes, the antioxidants, if you will, once they get into your body, they all come together to form almost this network that we call the antioxidant network. It's almost like weaving these antioxidants together into a fabric, and it is the integrity of this antioxidant fabric in your body that governs how you can manage your oxidative stress. And if one piece of that network breaks down, the whole thing unravels. And that is why this graph, and again, I've cited one of the reprints or articles that have now shown that if you measure carotenoids, it's a pretty good biomarker of the overall antioxidant network status. So that's what we have. And these are some of the studies that we have conducted. The first study we did was obviously to make sure that what we measure on the skin as far as carotenoids are concerned, that it actually correlates to what people traditionally measure in the blood. And we did the correlation study, and we showed with hundreds of people, and where we can show this is the regression coefficient, if you will, where we do this analysis, where we show what indeed we show on the skin correlated very well with what we can find in the blood. Okay, so we have clearly confirmed that in fact, dietary carotenoids in plasma, right now folks are still considering that as a gold standard for measuring or for monitoring dietary intake. I would argue that our scanner is a far more efficient and effective way of monitoring dietary intake of anybody, because it's non-invasive, it's quick, and we have actually corroborated that it reflects what if you measure the blood carotenoids. Yale, for example, one of the professors, a faculty member there, working with inner-city kids, they are using this Raman spectroscopic method to measure dietary intake in inner-city kids. So it's quite well validated along those lines. And we have measured vitamin C and other non-carotenoid antioxidants in plasma together with blood carotenoids and a scanner response, and we find once again there's pretty good correlation, giving us a very good level of confidence that when we claim that when you measure the skin number or the skin value, that is a reflection of overall antioxidant status, that that is a pretty accurate statement to make. And again, now this is not... we have a product obviously called LifePak, which is an antioxidant supplement, and many of the critics have initially, when we launched the scanner, say, well, this is nothing but just a LifePak detector. Not quite true. We don't bias our studies that bad, and we have validated it. So let's assume, and this was the hypothesis we worked with at the very beginning, because we knew that criticism was going to come, and they say, look, what does the NIH recommend for our intents and purposes in terms of a good diet? Inevitably, it always comes down to six to nine servings of fruits and vegetables. Why don't we use that? And we screened and sort of choose a variety of people, groups of people, where certain groups will be eating nothing, they're all meat eaters, and then going all the way to a group that consistently eats six to nine servings of fruits and vegetables, and we scan all of them. And what we find, indeed, once again, it was a good correlation that more fruits and vegetables that you eat, the better the antioxidant protection. I think it's by far the most unbiased demonstration of the scanner being a very objective monitor, and it's not a LifePak detector. And we can show this, in fact, once again, going with the hypothesis, right, that obesity has a huge impact on your oxidative stress level in the body, and it does. Tons of studies have been published on that. Why don't we see whether there's a correlation, what happens in these individuals as far as scanner score is concerned? And we can see what happens here, that again, as obesity goes up, or at least the BMI value goes up in certain groups, their scanner score actually drops. There's an inverse correlation in this instance. And smoking, as we all know, induces an extremely high level of oxidative stress because it generates so many free radicals in your body. And again, we can see plotting all the way from non-smokers to a heavy smoker, close to a pack a day or more, you can see there is a very gradual smoking-dependent drop in antioxidants in your body, because the antioxidants are being used up so rapidly by the generation of these extreme levels of free radicals. You would expect the hypothesis would predict that your antioxidants will drop in a smoker, and sure enough, we managed to prove that. Then finally, this... what does it mean? You know, at the end of the day, I get most medical professionals, okay, fine, we believe you on the antioxidant side, what does it really mean? Every day I pick up, frankly, a New England Journal article and says you take antioxidants, in fact, it's bad for you. Frankly, right, blah blah blah, you pick up your BMJ or whatever medical professional, there's a review article, some people say antioxidants are bad for you. Well, fundamentally, if you look upon those lines, okay, then really what we're saying is antioxidants are good is because they provide this clinical benefit that is related to a reduction in oxidative stress. Okay, that is really the clinical benefit link. And what we can show, in fact, if your scanner score goes up, and if we measure urinary biomarkers of oxidative stress, and in this instance is MDA, but we have measured another one that's a more robust marker called isoprostanes, these two markers, they tell us that in fact the oxidative stress level, or the oxidative stress status in your body overall, it does decrease when you have a higher scanner score. That reminds me to tell you, you know, you're going to ask, because many of you, particularly among the males, the scanner has become a competitive instrument, and they try to compete on getting the score as high as possible. If I have 70,000, I'm better than you at 60,000. It's not meant to be that. What fundamentally the reality with the scanner is, in fact, let's just assume on the remote possibility that antioxidants are bad for you, okay, but it's always a dose-related phenomenon with any substance or any drug or anything, right? So in fact, I would argue that the scanner is actually a safety mechanism that you can guide your patients to an optimal level of antioxidant intake, because we have plotted the scale that you're going to see all the way from the red to the blue. That why we chose blue to be the optimal or desired level of antioxidant protection is because that blue zone, if you will, is based on that fruits and vegetables study. Okay, so we have added, if anything else, going back to the premise in your Hippocratic Oath, do no harm. At the very minimum, that biophotonic scanner offers that protection to all your patients and all the people who come to you for medical care. And this credibility, it's validation, if you ask for it, you have so many of them, it comes out from the wazoo. And this is just sort of like some of them, and the scientists have presented in all kinds of scientific conferences around the world, and business awards. It obviously, when it first came out, it was first in class, it's innovative, and we have garnered quite a few awards along those lines. And finally, the medical rights, we have the medical rights in 2006. And fundamentally, you know, when you look at cholesterol measuring, when you look at your diabetics, you measure their HbA1c, and so on and so forth, what we are saying with the biophotonic scanner, it offers at least on the supplementation patient side, an ability to measure so that you can monitor your patients on an objective level, rather than them lying to you, because all patients lie, correct? So this is a validated, non-invasive, five minutes, put the palm on your hand, and you get your score, very easy. And why use this system? I think this is really it. So that's really what the scanner is all about. Now we provided you a way to look at a problem. We do obviously have a solution. Not much point highlighting a problem without offering a solution, and that's where the LifePak comes in. And later on, from the scientists, I'm sure you'll hear about all the things that we have done to formulate that LifePak to be the most comprehensive micronutrient supplement in the market today. And from then on, with that understanding, we can move to other things that we do in Nu Skin Enterprises, because when you look at us, a $1.5 billion company, obviously we're not a one-trick pony type company, and there are lots of things to come in the future. Thank you.
